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Sunday, May 15, 2005

Reloscam: From Rubec's Cube

Stephanie Rubec was on Reloscam at the Sun a while back, and left us some bread crumbs along the trail. here:

A real estate company is accusing the federal government of rigging a lucrative contract and failing to follow rules that would have handed it to the lowest bidder. Bruce Atyeo, owner of Envoy Relocation Services, questioned how he lost a contract to move defence department staff and soldiers, even though his bid was $8.6 million lower and offered more than the minimum requirements.

"How can you be that compliant and lower in price and still not win. It just flies in the face of common sense, let alone good purchasing practice," Atyeo said in an interview.

The contract to move public servants, and a separate one to relocate soldiers, were yanked from Royal LePage Relocation Services in 2003 under allegations the federal books had been cooked in its favour.

BIDDING REOPENED

Federal officials reopened the bidding, and a new $154-million combined contract was awarded to Royal LePage last April.

During the last competition, bureaucrats decided to have price count for only 25%, and the remaining points went to the bidder's computer system, relocation system, management team and training program.

Atyeo has appealed the contract award decision to the Canadian International Trade Tribunal and the Federal Court of Appeal.

He said, since Royal LePage's system was already in place, it was guaranteed a perfect score. It got 99%.

"We scored 919 points out of 1,000 possible points, we were over $8 million cheaper and we still lose because, of course, the incumbent is going to score almost perfect," he said.

Public servants accused of cooking the books when awarding a $1-billion federal contract were asked by an internal investigator to take a polygraph test. The highly unusual request was included in the notes of Public Works investigator Michel Genest, obtained by Sun Media under the Access to Information Act.

Genest grilled each member of the selection committee responsible for picking Royal LePage Relocation to move 12,000 soldiers and RCMP officers annually, and asked if they'd be willing to take a lie-detector test, according to the documents.

[Heavily edited report]

Their answers were deleted from the handwritten notes by Public Works' access officers who cited privacy reasons. They took more than one year to release the report.

The selection committee came under fire when it was revealed some of its members accepted gifts ranging from sweaters to a free cruise from Royal LePage Relocation before handing the real estate giant the lucrative $1-billion contract.

Genest's probe wrapped up last fall as the Canadian International Trade Tribunal ordered the feds to re-open the bidding on the contract, ruling that public servants had played favourites.

A source familiar with the investigation said when the department re-evaluated the bids for the 2002 five-year contract on the instructions of the Trade Tribunal, Royal LePage was not the clear winner.

[...] 4. Prior to the expiry of the IRP contract with Royal LePage Relocation Services (RLRS), Treasury Board Ministers also authorized the Treasury Board Secretariat to initiate a tender process for a new contract. This was done in accordance with Government of Canada contracting policy, and with the assistance of Public Works and Government Services Canada (PWGSC). A number of organizations expressed interest in bidding for this contract. Following an evaluation of bids received, Royal LePage Relocation Services was identified as the successful bidder. The contract is for 5 years, with a possible extension for another two years. [...]

It sounds as though, from the reading of Hansard, that after enough disquieting facts emerged, a retendering process was undertaken before the end of the existing contract (I have posted the Hansard excerpts elsewhere). If indeed the contract was retendered unilaterally, then did LePage mount an effort to hold the government to the contract, and if not, why not? It was a substantial piece of business (a billion or so?), apparently retendered before expiry without much of a fuss by the incumbent. I'm mystified.

NEWS RELEASE TRANSMITTED BY CCNMatthewsFOR: PUBLIC WORKS AND GOVERNMENT SERVICES CANADA

PWGSC: Minister Brison Announces Relocation Contract

NOVEMBER 2, 2004 - 15:24:36 ET

GATINEAU, QUEBEC--(CCNMatthews - Nov. 2, 2004) - Two competitive contracts were awarded to Royal LePage Relocation Services in the amount of $154,263,000 for relocating government employees across Canada and abroad. The announcement was made today by the Honourable Scott Brison, Minister of Public Works and Government Services.

"The awarding of these contracts to Royal LePage Relocation Services was done through a competitive, open and transparent process," said Minister Brison.

/T/

- The contract for National Defence is estimated to be valued at $124,984,000.- The contract for the Royal Canadian Mounted Police (RCMP) and Government of Canada employees will have an estimated value of $29,279,000.

/T/

It is anticipated that the work period for both contracts will commence on December 1, 2004 and run until November 30, 2009. Each contract has an option to extend the contract period for one additional two-year period.

Royal LePage Relocation Services will administer the relocation process, which includes taking advantage of volume purchases and providing advice to relocating employees and their families. The use of the department's Integrated Relocation Program is mandatory for members of the Canadian Forces and the RCMP, public service executives, deputy ministers, Governor-in-Council appointees and Public Service employees represented by unions. In 2003, there were 14,772 moves under the Program.

"This type of government-wide purchasing is part of our strategy to generate best value for taxpayers in existing initiatives, such as travel modernization. It will become more and more important as we move forward with our "smart buying" initiative to better manage purchasing for the government," added Minister Brison.

This re-tendering process stemmed from a ruling by the Canadian International Trade Tribunal and allegations of conflict of interest received by the department in March 2003 relating to the earlier awarding of this contract. An internal departmental investigation, which probed these allegations, concluded there was no actual conflict of interest.

So, an internal investigation concluded that the initial contract awarding process was just fine - which, logically, one would expect to have been the position of the contractor all along.

There was a communication, available here that announced that it was business as usual until the contract rebidding was complete:

Message from Brent DiBartoloSeptember 25, 2003

Sent on Behalf of Brent Di BartoloAssistant Secretary

Public Works and Government Services Canada (PWGSC) have made the decision to re-tender the contract for the provision of relocation services to the Federal Public Service, the RCMP and the Canadian Forces.

Until the new process is complete, and a new contract is awarded, Royal Lepage Relocation Services will continue to administer the current contract and provide the relocation services specified in the NJC Relocation - Integrated Relocation Program Directive.

If you require further information, please contact the Project Authority, Ram Singh at (613) 957-9139.

Michel Bonin

Someone else was curious about what might Mr. Singh may have communicated with the contractor. I found the following requests for information filed, in all places, at a site in New York tracking such requests:

SVC2003000378 - Public Works and Government Services Canada Date received: 2003-09-29

THE INVESTIGATION AND/OR AUDIT DRAFT AND FINAL REPORT ON THE PUBLIC SERVANTS INVOLVED IN THE TENDERING OF THE RELOCATION CONTRACT TO ROYAL LEPAGE RELOCATION. THE NOTES TAKEN BY AUDITORS/INVESTIGATORS WHILE LOOKING INTO THE TENDERING OF THE RELOCATION CONTRACT TO ROYAL LEPAGE RELOCATION.

DND2003000771 - National Defence Date received: 2003-10-16

All records relating to the Military Police investigation pertaining to the Aug 03 decision made by Public Works and Government Services Canada and/or the Department of National Defence, Treasury Board, and the Royal Canadian Mounted Police to cancel and re-tender contract number 24062-020006/B (Royal Lepage) See A-2003-00670 and 671